Ars Technica Newsdesk

Just three weeks after announcing their intention to slash CD prices, Universal is backing out on the most important part: signaling to customers that retailers should be charging considerably less for Universal CDs. While the company is still going to reduce its wholesale rates to retailers, they are not going to publish specific MSRP data on their wares because major retail outlets have protested. The original scheme involved lopping $6 off the average price of a CD, $3 coming from a reduction from Universal, and another $3 coming from the retailers. Universal would then put stickers on their CDs denoting the MSRP. Now, however, they will be placing stickers on their CDs without any specific pricing information, noting only that they CDs should be cheaper.

"While delivering a great value to the consumer is the primary goal behind JumpSTART, we believe that, at this time, the goal can be reached without including the MSRP [manufacturer's suggested retail price] in the sticker we plan to put on our product," reads a Sept. 17 letter from Universal Music and Video Distribution to retailers. The $12.98 sticker was eliminated because of two factors, Universal Music sources said: Retailers balked at CDs arriving in their stores with price tags already on them, and Universal Music believed that it could not legally discuss lowering prices with retailers before the announcement -- meaning that objections were not heard until afterward.

If you ask me, that's a bit like GM deciding to lower the dealers' rate on cars, only to tell the consumer that "yep, them cars sure should be cheaper now!" Except, really, this is worse:

The language of the new sticker is being debated within Universal Music, sources there said. It may say something like "Great Music, Great Price," or "Revolutionary New Price," the sources said.

For the love of Mac and Cheese (which I desperately have wanted for a week, but can't have because I'm rather ill), can't they come up with something less moronic than that? You can see how this is going to play out. CD wholesale prices will drop and the retail outlets will slowly undercut each other until something approaching a price equilibrium is reached. In practice, this is the ideal of the so-called free market, but when the goods in question are already dramatically overpriced, it's frustrating for many consumers have no reason to believe that the equilibrium will really reflect true market value in any so-called "free" way. This is, of course, the same industry that only one year ago was nailed with price fixing, and we've yet to see our $20 class action settlement checks roll in.